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GOATS 

By  Frank  W.  noxon 

SECRETARY,  RAILWAY  BUSINESS 
ASSOCIATION 

TwoTalksdelivered  before  theKiwanis 
and  Rotary  Clubs,  Lima,  Ohio,  Jan. 
7 and  8,  1924 

OU  will  observe  that  my  sub- 
ject is  “Goats.”  Before  but- 
ting in  among  you  I was 
assured  that  you  were  inno- 
cent of  anything  savoring 
of  the  hog  on  the  one  hand 
or  the  bull  on  the  other ; but  I inquired, 
“Does  Kiwanis  domesticate  the  goat?” 
Your  ritual,  I was  told,  is  quite  as  free 
from  that  interesting  animal.  This 
allayed  my  fear  of  outraging  your 
feelings. 

The  goat  is  a quadruped.  He  is 
celebrated  in  science,  song  and  story. 
In  the  zodiac,  capricornus  has  his  fore 
part  like  a goat  and  his  hind  part  like 


l 


a fish.  Hence  we  often  hear  a goat 
called  a poor  fish.  When  we  speak  of 
the  domestic  goat  we  make  no  refer- 
ence to  his  marital  condition.  The  goat 


/ 

**  r 

frequents  rocky  places 
and  can  subsist  on 
scrap  iron  and  obsolete 
Victrola  records.  He 
has  a habit  of  skip- 
ping. Mostly  he  skips 

}*\  J 

meals.  It  was  Chaun- 
cey  M.  Depew,  now 
at  89  still  Chairman 

of  the  New  York  Cen- 

** 

Capricornus, 
the  slump  in  rail- 
way purchases. 
About  this  time 
look  for  the 
industrial  and 
agricultural  goat 
who  feels  like  a 
poor  fish. 

tral  Lines,  who  in 
nominating  Benjamin 
Harrison  for  Presi- 
dent at  Minneapolis  in 
1888  referred  to  “the 
inebriated  chamois 
skipping  from  jag  to 
jag.”  It  is  said  that 
under  the  present  re- 

gime  there  are  no 
inebriated  chamois  — the  goat  obeys 
the  law  and  only  man  is  vile.  There 
are  types  of  vileness.  A student  of 
natural  history  was  asked  by  his  pro- 


2 


fessor:  “How  does  a goat  smell?”  He 
replied,  “Awful.” 

There  are  also  styles  of  goat.  The 
species  to  which  your  attention  is  in- 
vited today  is  not  a literal  goat  but  a 
figurative  goat,  like  the  Swedish 
nightingale,  the  Irish  bull,  the  Welsh 
rabbit,  the  mock  turtle,  and  indeed  the 
capricornus  itself.  He  is  the  sort  of 
goat  who  suffers  disagreeable  conse- 
quences not  of  his  own  making.  For 
example,  the  board  of  directors  of 
Kiwanis  think  they  have  done  me  to 
you  upon  the  motion  of  their  Vice- 
president,  W.  L.  Breckenridge.  As  a 
matter  of  fact  the  whole  thing  was 
conspired  by  L.  A.  Larsen,  his  boss 
at  the  Locomotive  Works.  Mr.  Larsen 
committed  the  crime.  Mr.  Brecken- 
ridge is  the  goat.  You  in  your  turn 
are  goats. 

Now  if  you  get  me  thus  far  you 
understand  what  I mean  when  I ob- 
serve that  in  the  little  mat- 
ter of  railroads  as  affected  by 
a benevolent  but  sometimes 
feverish  government  Kiwanis 


3 


is  a flock  of  goats.  There  is  nobody 
I love  more  than  a Congressman 
unless  it  be  a Senator.  But  as 
some  dead  old  statesman  once  said, 
they  certainly  have  an  itch  to  do 
something  for  the  sake  of  doing  it. 
Have  you  forgotten  the  young  physi- 
cian in  Cincinnati  out  on  his  first 
case?  He  looked  the  infant  over  with 
such  intelligence  as  he  had  accumulated 
and  bade  the  anxious  mother  give  him 
a tepid  bawth  every  morning.  “But,” 
she  cried,  “I  do  give  him  a tepid  bath 
every  morning.”  “Well,  then,”  replied 
the  medic,  “omit  bawth.” 

If  you  will  get  Congressman  Cable 
into  the  Club  or  some  other  place 
conducive  to  recklessness  and  ask  him 
why  so  many  of  his  contemporaries 
think  it  desirable  to  enact  a railroad 
bill  in  the  present  Congress  it  is  dol- 
lars to  marks  he  will  answer,  “The 
people  expect  us  to  do  something.” 
Heaven  knows  the  people  have  reason 
enough  to  expect  it.  They  have  sel- 
dom been  disappointed.  But  if  what 
you  expect  in  this  world  is  not  always 


4 


what  you  get,  sometimes  what  you 
get  is  not  what  you  want.  What  I 
aspire  to  accomplish  with  you  sportive 
specimens  of  the  genus  angora  today 
is  to  put  you  in  the  mood  of  the  lady 
in  the  popular  song:  “If  I don’t  get 

the  sweetie  I want,  God  help  the 
sweetie  I get.” 

This  man  Larsen  is  an  angora  in 
his  own  right.  You  see  there  is  down 
in  New  York  a goat  whom  for  the 
sake  of  argument  we  shall  call  Smith. 
Also  Smith  happens  to  be  his  name. 
Smith  runs  a railroad ; and  the  men 
who  run  the  railroads  are  all  goats. 
If  trouble  cannot  be  blamed  on  anyone 
else  it  is  the  righteous  and  orthodox 
thing  to  find  your  goat  amid  the  peaks 
and  valleys  of  transportation.  Have 
you  heard  of  fundamentalism?  Well, 
that  is  fundamentalism.  If  Smith 
doesn’t  have  enough  locomotives  he 
comes  at  once  into  all  his  privileges  as 
a goat.  Therefore  Smith 
keeps  a young  ibex  whose 
caper  is  to  estimate  future 
traffic  and  the  power  necessary 


5 


to  move  it.  This  goat  comes  in  and 
Smith  calls  out  cheerily,  “What  is  it, 
kid?”  The  juvenile  antelope  answers 
that  it  is  necessary  to  order  a couple 
of  hundred  locomotives.  So  they  send 
for  another  goat,  a cashmere,  or  finan- 
cial goat,  and  Smith  remarks,  “Say, 
kid,  we  need  a couple  of  hundred 
locomotives.  Can  we  pay  for  them 
out  of  earnings?”  “No,”  says  his 
bookkeeper  goat,  “not  all  of  them. 
We  are  scrapping  some  and  we  can 
replace  those  out  of  earnings  but  the 
rest  have  to  be  charged  to  capital  ac- 
count— we  have  to  borrow  the  money.” 
“Why?”  asks  Smith.  “Because  that 
is  the  rule  of  the  Interstate  Commerce 
Commission.”  “Oh,”  says  Smith. 

So  Smith  goes  out  to  get  the  money. 
Downtown  in  Manhattan  around 
Trinity  Church  they  have  people  who 
buy  or  sell  money.  Smith  goes  to 
one  of  these  hucksters  and  says,  “Will 
you  peddle  some  stock?”  This  guy 
laughs  until  the  Trinity  chimes  vibrate. 
“Railroad  stock  1”  he  shrieks.  “What’s 
that?  Oh,  yes,  I remember  now.  Ask 


6 


dad — he  knows.”  “How  about  bonds  ?” 
“No  use,”  he  answers,  “but  if  you  like 
I’ll  see  how  some  of  our  consumers 
feel.  If  they  don’t  want  bonds  shall 


The  wage  earner  skipping  from  jag  to  jag  of 
prosperity  and  hoping  not  to  fall  between 
into  the  valleys  of  shut-down  from 
lack  of  railway  orders. 

I try  equipment  trusts?”  Smith  calls 
him  a gang  of  pawnbrokers  and  other 
pet  names  but  very  reluctantly  replies 
yes.  An  equipment  trust  is  a note 
secured  by  a locomotive.  If  it  isn’t 
paid  you  don’t  have  to  find  somebody 


7 


with  the  money  and  the  appetite  to 
buy  the  whole  railroad.  You  can  sell 
the  locomotive  to  another  railroad, 
which  can  push  it  away  and  leave  the 
road. 

Well,  the  huckster  phones  Smith : 
“Nothing  doing.”  “Not  even  trusts?” 
gasps  Smith.  “Noth-ing  do-ing.” 
“Why  not?”  Smith  sobs.  “Investors 
afraid  of  Congress.”  “But,”  cries 
Smith,  “Congress  isn’t  going  to  do  us 
any  damage.”  “You  and  1 know  that, 
but  the  investors  don’t  believe  it.  You 
tell  ’em.” 

This  goat  here  in  Lima,  Larsen, 
goes  to  Smith  about  an  order  for 
locomotives.  “Noth-ing  do-ing,”  says 
Smith.  “But  why  ?”  demands  Larsen. 
“You  need  a couple  of  hundred,  don’t 
you?”  “Yep.”  “Then  what’s  the 
trouble?”  Smith  tells  him.  “Well,” 
says  Larsen,  “then  our  employees  will 
be  the  goats.  Shut-down.”  “Looks  like 
it,”  murmurs  Smith. 

Of  all  the  kinds  of  goats  whom 
Noah  sent  into  the  ark  two  by  two 
the  most  real  sirnon  pure  aromatic 


8 


antelope  is  the  employer  who  faces 
unemployed  workmen  and  their  fami- 
lies and  tries 
to  explain  a 
shut-down. 

Somebody 
butting  at  the 
gate.  “Who’s 
there?”  “John 
Galvin.”  Gal- 
vin is  a goat 
who  makes 
steel  castings 
and  the  like 
for  locomo- 
tives. “Let 
that  goat  in,” 
says  Larsen. 

Here  is  where 
Larsen  passes 
a part  of  the 
buck.  “What’s 
keeping  you 
awake  John?” 
h e inquires 
sardonically. 

“What  you  going  to  need  from  us?” 
answers  John.  “Not  a Troy  ounce,” 


Trinity  laughs  at  the 
mention  of  selling  railroad 
stocks. 


9 


says  Larsen,  “and  you’ll  be  all-fired 
lucky  if  we  don’t  cancel  what’s  on 
your  books  now.”  “Why?”  asks 
Galvin ; and  Larsen  proceeds  to  rub 
it  in  on  Galvin,  who  goes  back  to  the 
Steel  Foundry  and  orders  the  sign- 
painter  to  make  a handsome  new  half- 
time poster.  A few  hundred  more 
goats  in  Lima. 

Have  we  with  us  today  W.  H.  Stol- 
zenbach,  who  ekes  out  an  existence 
amongst  the  alps  of  wholesale  grocer- 
ies? Mr.  Stolzenbach  hasn’t  heard 
yet  about  the  epidemic  of  goats  over  at 
the  Locomotive  Works  and  the  Steel 
Foundry.  One  of  his  salesmen  is 
hauled  up  on  the  carpet.  The  worthy 
Kiwanian  brandishes  a bad  report. 
“Why  ?”  he  demands.  He  is  impatient 
about  this  because  of  another  little 
matter.  Collections  are  putrid.  The 
answer  is  that  some  of  the  locomotive 
goats  and  the  foundry  goats  are  feed- 
ing their  families  on  credit  or  on  short 
rations.  The  grocery  stores  have 
stopped  buying  and  are  asking  for 
time  on  past  accounts.  Do  I see  in 


10 


the  room  F.  D.  Bradley,  the  Kiwanian 
who  represents  wholesale  packing? 
Possibly  at  this  stage  of  our  little  ani- 
mal performance,  he  too  has  had  on 
the  carpet  the  problems  of  collapsing 
sales  and  de- 
cayed collec- 
tions. More 
goats  — 
Messrs.  Stol- 
zenbach  and 
Bradley  and 
their  families 
and  such  em- 
ployees as 
they  send  to 
pasture,  and 
their  families, 
and  every  re- 
tail grocer 
and  butcher 
in  Lima  and 
his  family  and  the  employees  they  lay 
off  and  their  families.  A tidy  little 
flock  of  goats. 

Coming  into  Lima  yesterday  morn- 
ing at  an  hour  when  nobody  was  up 
except  goats,  I admired  the  row  of 


This  leap  is  the  capriole. 
The  animal  hears  a threat 
of  railway  legislation  which 
will  put  him  on  the  blink 
so  he  goes  up  in  the  air 
and  kicks. 


11 


department  and  specialty  stores  on 
Main  Street.  Did  I exclaim,  “Ah, 
Rotarians  and  Kiwanians”?  No.  I 
whispered,  “Goats.”  All  these  loco- 
motive and  foundry  goats  and  whole- 
sale grocer  and  packer  goats  and  retail 
grocer  and  butcher  goats  and  their 
families  have  cut  down  their  purchases 
at  the  stores. 

What  does  the  epidemic  do  to  the 
goats  on  Main  Street?  Page  Oliver 
Steiner,  banker.  In  that  capric  hour 
when  the  money-dealers  around  Trin- 
ity, Manhattan,  report  investors  afraid 
of  Congress  and  the  goats  breed  fast 
and  furious  in  Lima,  what  do  you 
say,  Mr.  Steiner,  to  department  store 
Rotarians  and  Kiwanians  who  drop 
in  on  you  to  negotiate  accommoda- 
tions ? Is  it  true  that  the  rule  of  your 
life  is  safety  first  and  that  you  boost 
the  rate  but  cut  the  amount  and  speak 
loud  about  collateral  and  by  other  sur- 
gical processes  do  a smaller  business 
and  shrink  your  own  profits  and 
smoke  fewer  of  Mark  Kolter’s  cigars 
and  tell  C.  M.  Paine  when  he  phones 


12 


that  you  are  going  to  drive  last  year’s 
model  another  summer?  Are  you  not 
therefore  a goat  and  the  breeder  of 
goats  in  Lima? 

Dr.  A.  C.  Adams,  have  you  noticed 
when  the  sun  passes  into  capricorn 
that  patients  ordinarily  desperate  let 
nature  take  her  course  and  cut  you 
out? 

W.  S.  Jackson,  is  it  your  learned 
observation  that  when  Friend  Lar- 
sen tells  Friend  Galvin  “Noth-ing  do- 
ing” your  clients  are  too  busy  keeping 
their  checks  good  at  the  bank  to  enrich 
you  by  quarreling  among  themselves? 

The  Rev.  Sam  Huecker,  what  effect 
has  a pestilence  of  goats  Sunday 
morning  upon  the  contribution  box? 

James  Morton,  in  the  days  when  all 
these  goats  are  ultimately  consuming 
investors’  terror  of  Congress  do  you 
find  it  a capering  frolic — this  secre- 
tary’s job  of  maintaining  the  Board 
of  Commerce  budget? 

So  far  as  I know  there  is 
only  one  man  in  Lima  who  is 
not  a goat  and  that  is  the  indi- 
vidual who  sells  paint  to  indus- 


13 


trial  employees  when  they  have  idle 
days  at  home. 

Out  yonder  on  the  Western  farms 
and  ranches  and  down  South  on  the 
plantations  are  husbandmen  who  take 
from  the  soil  the  food  which  Mr. 
Stolzenbach  and  Mr.  Bradley  distri- 
bute in  Lima,  the  cotton  and  woolen 
goods  which  Lima  citizens  outside  the 
goat  season  buy  from  J.  E.  Morris, 
the  Kiwanian  clothier,  and  from  the 
department  and  specialty  stores  on 
Main  street.  When  Goat  Larsen  and 
Goat  Galvin  lock  horns  and  put  up 
the  sign  for  “shut-down,”  goats  ap- 
pear in  multitudes  through  those  dis- 
tant regions  more  than  80%  of  whose 
market  is  domestic.  By  some  strange 
twist  of  human  eccentricity,  where  in 
a bright  world  does  the  investor  take 
his  fright  of  Congress  but  just  there 
on  those  farms  and  ranches  and  plan- 
tations? Down  around  Trinity  Church 
the  money-dealer  might  say  to  Goat 
Smith  “You  tell  ’em” — meaning  the 
farmers ; and  Goat  Smith  might  reply, 
“The  farmers  won’t  listen  to  me and 
Smith  might  turn  to  Larsen  and  say, 


14 


“You  tell  ’em;”  and  Larsen  might 
answer,  “They  won’t  listen  to  me 
and  Larsen  might  say,  “Galvin,  you 
old  goat,  you  tell  ’em and  Galvin 
might  reply,  “They  won’t  listen  to 
me and  Galvin  might  pass  the  buck 
along  and  along  and  along.  Well, 
what  is  the  answer? 

What  would  you  think  of  Lima 
telling  them  ? There  are  a lot  of  other 
Limas,  who  might  be  induced  to  co- 
operate. I haven’t  the  December 
figures,  but  at  the  end  of  November 
the  year  of  Congressional  fright  had 
seen  hold-over  orders  for  locomotives, 
all  makers,  drop  from  1445  Jan.  1 to 
739  Dec.  1 — about  half.  Just  now 
operation  is  nearly  100%  in  the  loco- 
motive works  and  perhaps  60%  in  the 
foundries.  This  is  on  orders  held  over 
from  1922  and  placed  new  in  the 
early  months  of  1923.  Has  it  occurred 
to  you  that  a resumption  of  orders  on 
the  earlier  scale  might  have  a pro- 
nounced control  upon  the  birth-rate 
among  Lima  goats  in  the  months  soon 
to  come? 

The  first  place  to  tell  ’em  is  Wash- 


15 


ington.  Why  shouldn’t  the  goats  of 
Lima  ask  Congressman  Cable  to  ar- 
range that  if  the  Senate  and  House 
Committees  on  Interstate  Commerce 
hold  hearings  Lima  receive  notice  ? 
While  he  is  about  it  why  shouldn’t 
the  Congressman  himself  make  a list 
of  Congressmen  from  those  farms 
and  ranches  and  plantations  out  yonder 
and  tell  them  what  they  are  doing 
to  their  domestic  market  by  scar- 
ing investors  into  a slump  period  of 
railway  orders?  The  farmers  have  a 
society,  the  Farm  Bureau  Federation. 
The  President  is  O.  E.  Brad- 
fute  of  Xenia,  Ohio. 

Why  shouldn’t 


16 


the  goats  of 
Lima  get  him  here 
and  tell  him  or  go  to 
Xenia  and  tell  him 
there  — tell  him 
about  the 


serious  problem 
of  birth  control  in 
goats  and  its  relation  to 
consumption  of  farm  prod- 
ucts? When  the  Lima  goats 
have  organized  to  do  these  things, 
why  shouldn’t  they  butt  in  and 
horn  in  around  Trinity  Church,  Man- 
hattan, and  tell  ’em  there — the  money- 
dealers — a message  to  investors — that 
some  determined  and  well-organized 
goats  in  various  parts  of  the  country 
are  standing  together  to  prevent  the 
damage  which  the  investors  fear? 

At  the  Zoo  they  tell  me  the  goat  has 
a special  caper  known  as  the  capriole. 
He  leaps  upward  and  while  in  the  air 
he  kicks.  If  the  goats  of  Lima  and 
of  Limas  everywhere  desire  investors 
to  believe  Goat  Smith  when  he  says 
Congress  isn’t  going  to  do  the  rail- 
roads any  damage,  let  them  go  up  in 
the  air  and  kick. 


17 


Question  Box 

HY  does  President 
Coolidge  recommend  a 
, change  in  the  consolida- 
tion provisions  ? 

Undoubtedly  because  he 
has  faith  in  those  gentle- 
men who  tell  him  these  mergers  must 
be  immediate  or  we  perish.  Some  of 
the  rest  of  us  have  the  impression  that 
there  is  no  hurry. 

Do  you  remember  the  man  who  was 
denied  admission  at  the  pearly  gate? 
St.  Peter  said,  “Your  name  is  not  in 
the  book.  You  can’t  come  in  here. 
You  are  keeping  the  line.  Pass  along.” 
“But,”  insisted  the  man,  “I  have  led  a 
perfectly  good  life ; I was  a member  of 
the  Presbyterian  Church ; I gave  one- 
tenth  of  my  income  to  the  poor.  Please 
look  again.”  So  Peter  sent  a little  blue 
angel  in  after  more  books,  and  the 
angel  came  out  with  one  in  his  hand 
and  showed  Peter  a page,  and  Peter 
exclaimed,  “What  do  you  know  about 
that?  Here  is  your  name.  You  aren’t 
due  up  here  for  20  years  yet.  Who 
was  your  Doctor?” 

Everybody  knows  who  was  the 


18 


President’s  doctor.  It  was  Senator 
Cummins  of  Iowa,  long  Chairman  of 
the  Committee  on  Interstate  Com- 
merce. On  most  aspects  the  Senator 
believes  amendments  are  not  necessary 
now;  but  on  consolidation  he  and  his 
patients  are  knocking  at  the  gate  a long 
while  ahead  of  time.  Senator  Cummins 
has  on  his  mind  the  problem  of  the 
strong  and  weak  road,  both  taking  the 
same  rates  in  competition  and  one  hav- 
ing income  enough  to  give  good  service 
while  the  other  is  starving  itself  and  its 
public.  He  said  “The  strong  roads  must 
swallow  the  weak.”  The  Senate  Com- 
mittee brought  in  and  the  Senate 
passed  a provision  that  if  a scheme  of 
mergers  were  not  complete  in  seven 
years  then  compulsion  should  be 
applied.  The  House  substituted  per- 
mission for  compulsion  and  the  Senate 
agreed.  On  a plan  to  that  end 
the  Commission  has  been  holding  hear- 
ings and  will  soon  proclaim  it.  The 
mere  preliminaries  for  a permissive 
plan  have  taken  two  years  and  ten 
months.  How  many  years  would  be 
consumed  in  validating  com- 
pulsion? To  write  compul- 
sion into  the  statute  would  give 
us  not  consolidations  but  a 


19 


lawsuit.  Ask  the  Rotary  lawyer  to 
estimate  for  you  the  number  of  years 
that  would  drag.  St.  Peter’s  20  would 
not  be  far  out  of  the  way. 

On  top  of  that,  will  anybody  guaran- 
tee that  19  systems  created  equal  in 
income  will  remain  equal  any  longer 
than  is  required  for  the  differences  in 
efficiency  and  energy  among  their  man- 
agers to  become  manifest? 

NO  NECESSITY  NOW. 

What  harm  would  it  do  to  repeal 
the  rule  of  rate-making? 

Some  months  ago  a certain  radical 
Senator  was  reported  sick.  Another 
Senator  who  does  not  admire  him 
remarked  “Let  us  trust  it  is  nothing 
trivial.”  Whenever  your  enemy  wishes 
you  a happy  New  Year  it  is  a signal 
to  reach  for  your  pocket  book.  Who 
is  it  that  wants  to  repeal  the  rule  of 
rate-making  and  inquires  what  harm  it 
will  do?  It  is  the  man  who  wants  to 
break  transportation  down  and  force 
seizure  of  the  roads  by  the  govern- 
ment. Either  you  think  that  would  be 
harmful  or  you  don’t.  If  you  do,  then 
you  are  in  order  to  retort,  “If  repeal 


20 


will  do  no  harm  why  do  you  want 
repeal ?” 

They  have  made  converts  among 
intelligent  citizens,  utterly  opposed  to 
government  ownership  and  the  Plumb 
plan.  These  have  been  taught  to  say 
that  the  Interstate  Commerce  Commis- 
sion would  fix  adequate  rates  without 


Federal  control.  Uncle  Sam,  the  umpire, 
seeing  that  no  State  hits  another 
below  the  belt. 


any  such  rule.  Then  why  didn’t  the 
Commission  do  so  before  the  rule  was 
enacted  ? The  Commission  changed  its 
course  because  it  believed  that  was  the 
national  will.  The  evidence  of  the 
national  will  was  the  passage  of  the 
law.  Repeal  would  be  evidence  that 
the  nation  has  changed  its  mind. 


21 


The  section  of  the  Act  which  con- 
tains the  rule  is  imperfect.  Nobody 
is  satisfied  with  it.  Amendments  are 
ultimately  desirable.  They  can  wait. 
The  paramount  thing  now  is  to  give  the 
railway  managers  a legislative  respite 
in  which  to  build  up  their  properties 
and  service. 

NO  NECESSITY  NOW. 

Why  should  the  railroads  have  a 
guarantee  ? 

They  shouldn’t  and  they  don’t. 
Never  in  a single  month  since  the  pro- 
vision went  into  effect  has  net  income 
equalled  the  rate  of  return  at  which 
regulation  was  said  to  aim.  Nobody 
made  restitution.  The  government 
says  to  the  roads,  “We  are  going  to 
make  your  rates  and  if  even  then  you 
earn  too  much  we  are  going  to  limit 
your  income  by  taking  back  half  over 
6%  ; but  in  carrying  out  this  scheme, 
which  we  inflict  on  nobody  else  what- 
ever besides  railroads,  in  order  to 
cheer  you  up  we  promise  not  to  go 
so  far  as  to  cripple  you  into  impotence 
for  public  service.  If  we  do  take  too 
much,  try  and  get  it.”  It  is  like  Beau 
Brummel  in  the  play.  Mortimer,  the 
valet,  tells  him  the  tradesmen  are 


22 


below  demanding  payment.  “Promise 
them  something,”  says  the  Beau,  “And 
— Mortimer,  promise  yourself  some- 
thing.” 

Probably  the  clause  can  be  better 
phrased.  By  and  by.  NO  NECES- 
SITY NOW. 

Would  scaling  down  railway  valu- 
ation reduce  freight  rates? 

There  was  a Scotchman  in  Toronto 
who  complained  of  a reduction  in  the 
street  car  fares.  They  had  been  sell- 
ing four  rides  for  a quarter  and 
changed  it  to  five.  The  Scotchman 
came  in  furious.  “Why,”  he  said, 
“I’ve  been  walking  down  town  every 
morning  and  saving  car  fare.  Now  I’ve 
got  to  walk  five  mornings  instead  of 
four  to  save  a quarter.” 

The  effect  of  lower  valuations  upon 
freight  rates  would  be  about  as  real. 
The  paramount  object  of  having  rail- 
roads is  the  public  interest.  The  goods 
must  be  carried.  It  requires  a certain 
number  of  dollars  every  year  to  pay 
operating  expenses,  taxes,  interest  and 
dividends  sufficient  to  attract  capital 
for  additions  and  betterments.  It 
happens  that  for  the  sake  of  something 
to  hang  it  on  Congress  has  used  valua- 


23 


tion  as  the  base  upon  which  to  figure 
net  income  in  rate  per  cent ; but  what 
difference  would  it  make  in  the  num- 
ber of  dollars  required  for  the  job 
if  you  cut  the  valuation  in  two?  Would 
each  dollar  buy  twice  as  much  of  what 
the  railroads  must  have  to  serve  the 
public?  Certainly  not.  You  would 
merely  have  to  fix  double  the  rate  of 
return. 

The  only  possible  connection  be- 
tween valuation  and  expenses  would 
be  repudiation  of  bonds  to  save  inter- 
est ; and  the  American  people  are  too 
shrewd  even  if  they  are  not  too  straight 
to  repudiate  contract  obligations  legally 
entered  into.  Who  are  these  gentle- 
man who  urge  scaling  down  valuation  ? 
Is  there  one  among  them  who  doesn’t 
favor  government  ownership  or  the 
Plumb  plan?  For  their  purpose,  scal- 
ing down  valuation  would  be  effective. 
But  what  is  their  purpose  ? It  is  to  put 
a stop  to  the  magnificent  service  which 
has  given  the  nation  prosperity  and 
driven  government  ownership  off  the 
platform. 

It  is  well  to  consider  for  future 
action  improvements  in  the  valuation 
provisions.  NO  NECESSITY  NOW. 


24 


Ought  Congress  to  order  a reor- 
ganization of  the  rate  schedule  to  aid 
the  farmer  ? 

That  is,  Congress,  having  created  a 
Commission  to  perform  the  judicial 
function  of  deciding  the  right  and 
wrong  of  freight  rate  relations  between 
commodities  and  between  groups  of 
shippers,  is  asked  to  make  those  judi- 
cial decisions  itself.  This  whole  ques- 
tion of  the  reorganization  of  the  rate 
schedule  by  reducing  some  rates  and 
raising  others  has  been  before  the  Com- 
mission in  concrete  form  ever  since 
Mr.  Hoover  as  Secretary  of  Com- 
merce began  urging  it.  The  Commis- 
sion replies  that  every  specific  case  will 
be  tried  and  adjudicated  on  the  merits, 
that  hundreds  of  thousands  of  such 
corrections  are  made  annually  all  in  the 
day’s  work,  but  that  the  principal  need 
of  shippers  just  now  is  stability  of 
rates,  not  turmoil.  That  is  their  deci- 
sion. Now  they  are  to  be  ordered  to 
make  another  one. 

Can  you  imagine  the  uproar  if  Con- 
gress should  order  reversal  by  some 
federal  court? 

For  myself  I confess  that  whenever 
anyone  proposes  legislative  rate-mak- 


25 


ing  or  rate-making  under  political  pres- 
sure of  any  kind  I get  into  the  state  of 
mind  of  the  Irishman.  He  said,  “I’m 
glad  I don’t  like  spinach ; because  if 
I liked  it  I’d  ate  it,  and  I hate  the 
damned  stuff.” 

Apart  from  the  propriety  of  the 
proposed  procedure,  the  thing  itself  is 
futile.  It  is  easy  enough  to  find  rates 
to  reduce,  but  where  are  you  going  to 
find  groups  of  shippers  coming  for- 
ward with  a patriotic  cheer  and 
begging  to  have  the  compensatory 
advances  bestowed  upon  them?  You 
have  all  heard  of  the  man  who  was 
picked  up  in  the  street  and  carried  to 
the  hospital,  where  they  diagnosed  it 
first  as  acute  alcoholism,  but  the  alco- 
holic man  was  off  for  the  day.  The 
appendix  man  was  on  duty,  so  they 
decided  he  had  appendicitis  and  sent 
for  an  anesthesist.  Just  as  they  were 
about  to  gas  him  he  woke  up  and  de- 
manded “What  are  you  doing?”  They 
told  him  and  he  said,  “I’ve  had  my 
appendix  out  twice  already.”  The  sur- 
geon said  that  made  no  difference,  as 
the  anesthesist  had  come  a long  dis- 
tance and  his  time  couldn’t  be  wasted. 
They  cut  him  open  and  sure  enough  it 
had  been  removed.  The  surgeon 


26 


instructed  the  internes  to  tatoo  on  the 
man’s  abdomen,  “Don’t  go  in.  No 
appendix  here.” 


Uncle  Sam’s  Carrier : Creditors  are  below, 
sir,  demanding  wages,  supply  money  and  taxes. 

Uncle  Sam : Promise  them  something. 

Carrier ; Yes,  sir. 

Uncle  Sam:  And — promise  yourself  some- 
thing. 

The  Commission  has  already  cut 
wherever  it  dared,  eliminating  in  1923 
about  $500,000,000  of  revenue. 

It  may  be  thal  one  of  these  days  we 


27 


shall  face  the  question  whether  Con- 
gress can  do  the  job  better.  NO 
NECESSITY  NOW. 

What  hope  is  there  for  stopping 
the  rise  in  freight  rates? 

Economies  in  railway  operation.  Any 
other  nostrum  is  bunk.  The  trick  must 
be  turned  by  the  railways  and  by  the 
developers  of  mechanical  improve- 
ments and  progress  in  method.  For 
years  they  lived  from  hand  to  mouth. 
Progress  toward  economy  had  been 
great.  To  foreign  observers  it  seemed 
marvelous.  If  it  had  not  been  for  that 
progress  freight  rates  would  long  ago 
have  been  higher  than  anything  we 
have  seen.  For  economies  had  to  over- 
come a steady  and  formidable  advance 
in  wages. 

Such  progress  must  continue  if  the 
railroad  problem  is  to  be  solved.  We 
postponed  too  long  the  reform  of  our 
government  policy  of  regulation.  The 
plant  is  consequently  in  arrears.  This 
is  true  of  improvements  in  the  type  of 
locomotives  and  cars,  in  track  appli- 
ances, and  in  junction  and  terminal 
design.  Now  we  have  to  pay  for  our 
neglect.  For  a while  freight  rates  must 
be  higher  than  we  are  accustomed  to 


28 


in  order  that  in  the  future  the  rise 
may  cease.  The  struggle  of  the  engi- 
neers and  manufacturers  against  the 
inflation  of  expenses  through  wages 
and  other  factors  is  like  a base  ball 
game  between  colored  gentlemen  that 
I heard  about  in  the  South.  The  engi- 
neers resemble  the  team  in  the  field.  A 
visitor  asked  the  centre-fielder. 
“What’s  the  score?”  “35  to  nothing.” 
“Who’s  ahead?”  “They  is.”  “They’re 
walloping  you  fellows,  aren’t  they?” 
“No,  suh.  We  ain’t  been  to  bat  yit.” 

If  private  initiative  under  wise  regu- 
lation fails  to  produce  the  required 
economies  after  a reasonable  trial, 
legislation  may  become  timely.  NO 
NECESSITY  NOW. 

Does  not  federal  control  violate 
state  rights? 

No.  It  sustains  and  enforces  state 
rights.  If  Indiana  tries  to  do  some- 
thing to  Ohio  federal  control  prevents 
her.  If  Ohio  tries  to  do  something  to 
Indiana  that  is  not  right  but  wrong. 
The  only  advocates  of  state  rights  are 
those  who  want  license  to  commit  state 
wrongs.  A Youngstown  manufac- 
turer tells  how  he  was  asking  for 
freight  cars  and  could  not  get  them, 


29 


and  saw  empty  cars  rolling  serenely 
past  his  window  on  their  way  to  South 
Dakota.  Will  somebody  suggest  how 
that  South  Dakota  wheat  farmer  could 
get  a freight  car  sent  him  empty  from 
somewhere  east  of  Ohio  if  he  had  to 
depend  on  the  railroad  commission  of 
South  Dakota  to  get  it  for  him?  The 
authority  is  federal.  It  is  the  same 
with  rates.  Does  Ohio  want  Indiana 
to  pay  less  than  her  share  of  the  reve- 
nue of  railroads  which  serve  both 
states  and  place  Ohio  in  the  position 
of  either  paying  more  than  her  share 
or  putting  up  with  poor  service  ? Some- 
body has  got  to  umpire  it.  There  can 
be  no  other  umpire  than  the  federal 
authority. 

Under  the  Act  the  Interstate  Com- 
merce Commission  is  directed  to 
arrange  co-operation  with  state 
authorities  and  has  made  great  progress 
in  that  direction.  If  you  hear  anybody 
urging  restoration  of  state  control  ask 
him  to  put  his  hand  on  his  heart  and 
say  he  was  not  sent  by  some  state 
official  who  clings  to  his  job. 

If  that  provision  will  not  remove  the 
friction  after  a reasonable  period,  we 
can  consider  what  to  do  next.  NO 
NECESSITY  NOW. 


30 


Ought  the  Labor  Board  to  be 
abolished  ? 

No.  At  present  two  camps  face  each 
other,  one  demanding  abolition,  the 
other  demanding  that  decrees  be  made 
obligatory.  That  means  deadlock. 
What  has  been  going  on  is  an  excellent 
illustration  of  nature  taking  her  course 
without  legislative  interference.  The 
work  of  the  board  has  dwindled.  Com- 
pany autonomy  in  dealing  with  labor 
has  been  restored.  Negotiation  has 
taken  the  place  of  strikes  and  the 
threat  of  strikes.  No  interruption  of 
service  is  in  sight.  A bird  in  the  hand 
is  the  noblest  work  of  God. 

It  may  be  it  can  be  improved  upon. 
If  ever  the  various  groups  of  thinkers 
can  agree  on  a substitute  it  will  be 
timely  to  consider  another  arrange- 
ment. NO  NECESSITY  NOW. 

With  reference  to  transportation, 
what  can  business  men  do  to  pro- 
mote general  prosperity  in  1924? 

They  can  persuade  Congress  to  try 
the  Act  further  unamended  and  make 
unmistakable  to  railway  managers  and 
to  investors  that  the  demand  for  a 
legislative  holiday  is  too  strong  for 
Congress  to  defy. 

This  assurance  will  sustain  the  flow 


31 


of  capital  into  railroad  improvements. 
Large-scale  railway  purchases  began 
in  January,  1922,  precisely  at 
the  lowest  ebb  of  general  busi- 
ness. They  have  ever  since  been 
the  largest  factor  in  business  revival. 
If  the  roads  buy  freely  now,  this  will 
continue  to  maintain  industrial  pay- 
rolls and  to  provide  a domestic  market 
for  farm  products  and  manufactures. 

The  railroads  by  the  same  process 
will  equip  themselves  to  carry  the  ton- 
nage and  again  as  in  1923  meet  the 
peak  of  load  without  those  car  short- 
ages so  often  in  the  past  disastrous  to 
agriculture,  industry  and  trade. 

Success  of  the  railroads  for  another 
couple  of  years  in  carrying  the  traffic 
offered  will  go  far  to  remove  appre- 
hension about  government  ownership 
and  to  reassure  those  who  fear  rail- 
roads are  but  the  first  trench,  with 
other  forms  of  business  awaiting  the 
the  socialist  or  soviet  attack  just 
behind.  Stability  of  railroad  laws  now 
spells  confidence  all  around,  and  the 
foundation  of  national  prosperity  is 
confidence. 

Whatever  amendment  is  proposed, 
the  answer  is  that  this  is  no  time  for 
tinkering.  NO  NECESSITY  NOW. 

32 


Form 


RAILWAY  BUSINESS  ASSOCIATION 
LIBERTY  BUILDING 
PHILADELPHIA 


